Corporate tax exemptions for employee treatments – A summary

From 1st January 2015 employers have been able to fund the costs of medical treatments recommended by a healthcare professional – free of tax to employer and employee.

Only treatments “aimed at helping an employee return to work after a period of absence due to injury or ill-health” are admissible. Medical investigations – MRI scans etc. do not appear to be covered.

A healthcare professional must have assessed them as ‘Not fit’ for work or ‘May be fit’ for work for at least 28 consecutive days, due to ill health or injury

OR

The employee has already been absent from work for at least 28 consecutive days due to ill health or injury.

Treatment can start up to 14 days after the employee has returned to work.

A healthcare professional is defined as a registered medical practitioner, a registered nurse, or an occupational therapist, physiotherapist or psychologist registered with an appropriate regulatory body.

The tax exempt limit is £500 per employee per tax year. Any additional payments remain liable to tax and NICs.

For further information please see: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/355604/Draft_legislation-consultation.pdf